Iranian businesspeople say banks and financial institutions in the United Arab Emirates (UAE) are shunning them, in accord with international sanctions against Tehran.
Hamid Husseini, a member of the Tehran Chamber of Commerce, said most banks in the UAE are refusing to provide services to Iranian businessmen who are importing or exporting goods from or to Iran, the Iranian economic magazine Sarmayeh reported on Monday.
Another member of the chamber, Budram Sultani, said that while banks in the Emirates do agree to open accounts for Iranian businesses, they then impose strict supervision over them and will freeze accounts that are involved in what he described as dubious agreements.
This latest trend is a great source of concern for Iran’s business community, since the UAE is an important trade partner for Iran, and the Emirates accommodate a large number of Iranian businesspeople.
The international community is using sanctions to pressure Iran into abandoning its controversial nuclear program. Some countries fear the program is being used to manufacture a nuclear bomb.
Iran insists the program is for the peaceful purposes of creating energy and upholds its right to possess nuclear technology.
Three sets of economic sanctions have so far been imposed on Iran by the United Nations.
The UAE is an ally of the United States, Iran’s arch-foe, and like several Sunni Muslim countries in the Gulf is concerned about the prospect of the Shi’ite Iran becoming a nuclear power.
Iran has warned that any military offensive on nuclear facilities on its soil will be met with Iran’s forcible closure of the strategic Hurmuz Strait. In this eventuality, global oil supplies will be hit hard and the UAE will be one of the countries to bear the brunt of such an action.
David Butter, Middle East director at the Economist Intelligence Unit, said downscaling relations between banks in the UAE and Iranian businesses could be the result of several factors. The United States Department of Treasury has been urging banks to look carefully at deals that are processed on the way to Iran, he told The Media Line.
"Liquidity is a lot tighter in the UAE at the moment and the banks, on all kinds of transactions, are exercising caution," he said.
The Iranians, Butter explained, have had to be very creative in recent years in how they finance trade transactions.
"When such restrictions appear, resourceful people can find a way around them," he added.